Home Loans – Benefits to Women Borrowers

Gone are the days when women used to leave financial decisions to men in the family. In today’s world, women have become more aware, financially independent and started creating assets like house properties to support themselves and their dependents.

So, the government has successively tried to introduce policies, which encourage women empowerment and ensure their financial inclusion in all spheres. For a woman, possessing her own house gives a great sense of financial security.

This is why the government has taken various steps like special accounts for women &girl child, concessional rates and also special schemes to encourage women to buy houses&take home loans in their name.

Now, let’s see what the advantages do women borrowers of home loans have:-

1) Lower Interest Rates:

All the banks and NBFCs offer lower interest rates on housing loan to female borrowers as compared to their male counterparts because

i) to encourage financial empowerment and independence of women and

ii) they (banks and NBFCs) believe women have a lower risk profile as compared to men. Have a look at the interest rates offered by some of the banks to women and other borrowers:

Effective Home Loan Rates for Women Borrowers v/s others

Bank/Financial Institution

For Women Borrowers

For Others

Benefit

State Bank of India

8.60%

8.65%

0.05%

HDFC

8.65%

8.70%

0.05%

ICICI

8.65%

8.70%

0.05%

Punjab National Bank

8.65%

8.70%

0.05%

Note:- For Amount upto Rs. 75 lakhs only

As can be seen above, most banks and financial institutions offer a differential of 5 basis points to the women borrowers.

2) Higher probability of loan getting accepted:

For applying home loan, the applicant must match the eligibility criterias of the lender, submit the required documents & proof, and also have a healthy credit score.

Not with standing this, women are perceived as less risky borrowers, regular in paying their dues and less likely to default.

Hence, though loans are approved on the basis of numbers and documents, it is an unwritten fact that the chances of a woman applicant/co-applicant getting a home loan are higher than a man.

3) Very Low Stamp Dutie:

Although this is not an advantage offered by lenders, but it is yet a major saving for the borrower. The Stamp Duty to be paid for registering a house deviates from state to state in India.

There are several other criterias and sub-criterias on which the stamp duty depends. But, only three states viz. Delhi, Rajasthan, and Haryana have offered a partial waiver on stamp duty to women borrowers of the house in these respective states.

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